2023 Legislative Priority #1: Pass SB102

Establish Property Tax Discounts, Preempt Rent Control, & Expand Housing Opportunity

This is the first in a series of three emails that will highlight the policy issues FAA members will be discussing with legislators and staff members in Tallahassee this month at Impact.


Key FAA staff contact: Amanda White

Issue:

Florida’s rapidly growing population has created a housing shortage and the lack of supply is impacting housing attainability and affordability across the state.


For years, FAA and its members have advocated for solutions to address Florida's housing affordability and supply related challenges. One of the solutions FAA has long championed, property tax discounts for affordable and workforce housing, was recently included in Senate President Kathleen Passidomo's priority legislation (SB 102) for the 2023 session.


Legislative Solution:

FAA supports the passage of SB 102, which would provide a variety of creative tools, including property tax discounts, to address Florida's current and future housing supply needs.


SB 102:

  • Preempts local governments from pursuing rent control by removing the loophole currently in statute, which allows local governments to enact rent control if certain conditions are met.
  • Creates a "missing middle" property tax exemption for apartments that serve families with incomes up to 120% of area median income.
  • Allows counties and municipalities to offer an optional property tax exemption for affordable housing (units that serve families with incomes up to 50% of area median income and below).
  • Prevents overly burdensome zoning, density, and height restrictions for affordable housing that often serve as a barrier to new construction.
  • Provides a new sales tax refund for building materials used to construct affordable housing developments funded through Florida Housing Finance Corporation.
  • Creates a new Live Local Corporate Tax Donation program that will allow additional funds to be used for State Apartment Incentive Loan (SAIL) projects.
  • Provides $259 million for the SAIL program.


The passage of SB 102 will provide a variety of effective tools that can be used to ensure the feasibility of attainable housing construction and preserve existing affordable and workforce housing stock. That is why the Florida Apartment Association urges the Legislature to pass SB 102.


Background:

In order for new apartment construction to break ground, a developer must first secure financing from investors, who demand a specific rate of return in exchange for their investment. It is difficult for developers to achieve the necessary rate of return for affordable and workforce apartments, which are rented below market rate. As a result, it can be extremely challenging for a developer to secure the financing that is critically needed to make an affordable or workforce housing construction project viable. Developers that do secure funding often encounter additional hurdles at the local level before they ultimately receive approval to begin the construction process.


Because of these challenges, developers rely on a combination of state and federal tax discounts along with private funding when constructing affordable or workforce housing. The process of obtaining these government tax discounts is cumbersome and competitive, with very few projects ultimately receiving this funding each year. Additional tools are needed to stimulate the construction of affordable and workforce housing that is desperately needed across the state.


Property tax discounts can be an effective tool to stimulate the creation of affordable or workforce housing. However, Florida law currently lacks clarity regarding a local government’s ability to waive or reduce local property tax rates for affordable and workforce housing.

IMPACT Registration Information:


Impact, Powered by FAA, will take place February 21-22 and spaces are rapidly filling up. Don't miss this opportunity to share the industry's legislative priorities with Florida Lawmakers at the Capitol. Register now, without delay! The deadline to register is February 10, but space is limited.


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